161 P.3d 303 (Okla. 2007), 102,828, In re Assessments for Year 2005 of Certain Real Property Owned by Askins Properties, L.L.C.

Docket Nº:102,828.
Citation:161 P.3d 303, 2007 OK 25
Opinion Judge:LAVENDER, J.
Party Name:In the Matter of the ASSESSMENTS FOR THE YEAR 2005 OF CERTAIN REAL PROPERTY OWNED BY ASKINS PROPERTIES, L.L.C. Askins Properties, L.L.C., Petitioner/Appellant, v. Oklahoma County Assessor and the Board of Equalization of Oklahoma County, Defendants/Appellees.
Attorney:William K. Elias and Linda Jo Blan-Byford, Elias, Books, Brown & Nelson, P.C., Oklahoma City, Oklahoma for Petitioner/Appellant., Gretchen Crawford, Assistant District Attorney, Oklahoma County District Attorney's Office, Oklahoma City, Oklahoma for Defendants/Appellees., Sandra D. Rinehart, Seni...
Case Date:April 24, 2007
Court:Supreme Court of Oklahoma
 
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161 P.3d 303 (Okla. 2007)

2007 OK 25

In the Matter of the ASSESSMENTS FOR THE YEAR 2005 OF CERTAIN REAL PROPERTY OWNED BY ASKINS PROPERTIES, L.L.C.

Askins Properties, L.L.C., Petitioner/Appellant,

v.

Oklahoma County Assessor and the Board of Equalization of Oklahoma County, Defendants/Appellees.

No. 102,828.

Supreme Court of Oklahoma

April 24, 2007

Rehearing Denied June 26, 2007.

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[Copyrighted Material Omitted]

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Appeal from the District Court of Oklahoma County, State of Oklahoma; Honorable Noma D. Gurich, Trial Judge.

¶0 James Askins and Debra Askins (Askins) are co-trustees and sole beneficiaries of the James Askins and Debra Askins Revocable Trust (Trust). The Trust held title to two pieces of real property in Oklahoma County. In December 2004 the Askins as co-trustees executed a quit claim deed conveying title to the two properties to Petitioner/Appellant, Askins Properties, L.L.C. (AP), a limited liability company in which the Askins are sole owners of one hundred percent (100%) of the membership units. Defendant/Appellee, the Oklahoma County Assessor increased the fair cash value of each property more than five percent (5%) for 2005 ad valorem tax purposes. OKLA.CONST. art. 10, § 8B provides that "the fair cash value of any parcel of locally assessed real property shall not increase by more than five percent (5%) in any taxable year." However, § 8B provides an exception to this yearly cap "[i]f title to the property is transferred, changed, or conveyed to another person, the property shall be assessed for that year based on the fair cash value as set forth in [OKLA.CONST. art. 10, § 8]." AP protested the assessments with Defendant/Appellee, the Oklahoma County Board of Equalization, but the Board denied the protests. AP appealed to the district court and both sides sought summary judgment. The trial court granted summary judgment for Defendants and against AP. As part of its ruling the trial court held that 68 O.S. § 2802.1(A)(4)(g)(last amended in 2002) violated the Oklahoma Constitution. As relevant here § 2802.1(A)(4)(g) basically provides that a deed transferring property to a limited liability company is not a transfer, conveyance or change of title to another person within the contemplation of the § 8B exception when the transferors are the only owners of the limited liability company. AP appealed to this Court. We reverse the trial court judgment and remand to the trial court with direction to grant judgment to AP. We also hold § 2802.1(A)(4)(g) is constitutional to the extent it is applied to the summary judgment record presented in this appeal which shows that although legal title was transferred to AP, the equitable/beneficial ownership was in

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the same two individuals both before and after the transfer, the Askins.

TRIAL COURT JUDGMENT REVERSED AND MATTER REMANDED WITH DIRECTION TO THE TRIAL COURT TO ENTER JUDGMENT IN FAVOR OF PETITIONER/APPELLANT, ASKINS PROPERTIES, L.L.C.

William K. Elias and Linda Jo Blan-Byford, Elias, Books, Brown & Nelson, P.C., Oklahoma City, Oklahoma for Petitioner/Appellant.

Gretchen Crawford, Assistant District Attorney, Oklahoma County District Attorney's Office, Oklahoma City, Oklahoma for Defendants/Appellees.

Sandra D. Rinehart, Senior Assistant Attorney General, Office of the Oklahoma Attorney General, Oklahoma City, Oklahoma for Oklahoma Attorney General W. A. Drew Edmondson.

LAVENDER, J.

¶1 We decide in this case whether the trial court erred in denying summary judgment to Petitioner/Appellant, Askins Properties, L.L.C. (AP) and granting summary judgment to Defendants/Appellees, the Oklahoma County Assessor and the Oklahoma County Board of Equalization (County or Assessor and Board, respectively). The case also requires us to decide if the trial court erred in ruling 68 O.S. § 2802.1 (A)(4)(g) violative of the Oklahoma Constitution. We hold the trial court erred, we reverse the trial court judgment to the County and against AP, rule AP was entitled to summary judgment and remand to the trial court with direction to grant summary judgment to AP. We also hold § 2802.1(A)(4)(g)(last amended in 2002) is constitutional, at least to the extent it is applied to the summary judgment record presented in this case. As to other factual situations that might fall within the confines of § 2802.1(A)(4)(g), but which are not presented by the factual circumstances existent in this case under this record, questions concerning interpretation and constitutionality of that statutory provision will not be considered and determined because such other factual situations involve merely abstract matters not within the scope of the justiciable controversy presented.

FACTUAL BACKGROUND AND PROCEDURAL HISTORY

¶ 2 James Askins and Debra Askins (Askins) are co-trustees and sole beneficiaries of the James Askins and Debra Askins Revocable Trust (Trust). As pertinent here, the Trust held title to two pieces of real property in Oklahoma County. In December 2004 the Askins, as co-trustees of the Trust, signed a quit claim deed conveying title to the properties to AP, a limited liability company in which the Askins are sole owners of one hundred percent (100%) of the membership units.1

¶3 The Assessor increased the fair cash value of each property over the 2004 value more than five percent (5%) for 2005 ad valorem tax purposes. OKLA.CONST. art. 10, § 8B provides that "the fair cash value of any parcel of locally assessed real property shall not increase by more than five percent (5%) in any taxable year." However, an

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exception found in § 8B to the five percent (5%) yearly cap/limit is that "[i]f title to the property is transferred, changed, or conveyed to another person, the property shall be assessed for that year based on the fair cash value as set forth in [OKLA.CONST. art. 10, § 8]." AP filed protests with the Board. The Board denied the protests and sustained the values set by the Assessor. As allowed by 68 O.S.2001, § 2880.1 (A), AP appealed the Board's decision to the district court.

¶ 4 In the trial court both AP and the County sought summary judgment. The parties essentially agreed there was no substantial controversy as to any material fact and that the matter should be determined as a matter of law. Our review of the record shows there is no substantial controversy as to any material fact and the matter may be determined as a matter of law.

¶5 The parties also viewed the case as turning on whether or not a certain 2002 amendment to 68 O.S. § 2802.1 (A)(4)(g) was constitutional. As relevant to this case § 2802.1(A)(4)(g) provides, in effect, that a deed transferring property to a limited liability company is not a transfer, conveyance or change of title to another person within the contemplation of the above § 8B exception when the transferors are the only owners of the limited liability company. AP took the position the amendment was constitutional. It also basically argued that because the same two people both before and after the transfer of the legal title held the equitable ownership of the property that the 5% yearly fair cash value cap or limit still applied. The County asserted the amendment was unconstitutional, relying primarily on an opinion of the Oklahoma Attorney General (Attorney General) in 2003 OK AG 39, where it was opined the 2002 amendment to § 2802.1(A)(4)(g) was unconstitutional and the Legislature exceeded its authority to pass legislation implementing the provisions of § 8B.

¶ 6 The trial court granted summary judgment to the County and against AP. AP appealed the trial court's judgment, an appeal we previously retained for disposition.2 In a July 2006 Order the Attorney General was notified of the pendency of the appeal and afforded an opportunity to file a brief on the question of the constitutionality of § 2802.1(A)(4)(g). The Attorney General submitted a brief in August 2006 and consistent with 2003 OK AG 39 the brief argues the 2002 amended statute is unconstitutional as exceeding the bounds of that legislative authority necessary to implement the provisions of § 8B. The brief also in essence argues the amendment to § 2802.1(A)(4)(g) is not consistent with the intent of the § 8B exception.3

¶7 We hold the trial court erred, reverse the trial court judgment and remand to the trial court with direction to enter judgment for AP. We also hold § 2802.1(A)(4)(g) is constitutional, at least to the extent it is applied to the summary judgment record presented in this case.

STANDARD OF REVIEW

¶ 8 Summary judgment is reviewed de novo, i.e., an appellate court engages in a plenary, independent and non-deferential re-examination of the trial court's ruling. In re Estate of MacFarline, 2000 OK 87, ¶ 3, 14 P.3d 551, 554-555 (quoting Carmichael v. Beller, 1996 OK 48, 914 P.2d 1051, 1053 and citing Manley v. Brown, 1999 OK 79, ¶ 22 n. 30, 989 P.2d 448). Only when the evidentiary materials submitted as a whole demonstrate there are undisputed facts on material issues supporting but a single inference is

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summary judgment in favor of a party appropriate. In the Matter of the Assessment of Real Property of Integris Realty Corp., 2002 OK 85, ¶ 5, 58 P.3d 200, 202-203.4 The determination of legal questions involving statutory interpretation are also subject to de novo appellate review. Fulsom v. Fulsom, 2003 OK 96, ¶ 2, 81 P.3d 652, 654 (citing Samman v. Multiple Injury Trust Fund, 2001 OK 71, ¶ 8 and n. 5, 33 P.3d 302, 305 and n. 5). Basic review standards concerning constitutional interpretation will be set out as appropriate in the following part of this opinion.

ANALYSIS

¶9 Article 10, § 8B of the Oklahoma Constitution was adopted by the Oklahoma people at an election held in...

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